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On Friday Judge Claudia Wilken ruled that the NCAA was committing anti-trust violations by refusing to compensate men’s basketball and football players for their name, image or likeness. Judge Wilken’s decision is 99 pages long, but the most important part of her decision is her systematic destruction of all the arguments the NCAA made for why amateurism in football and men’s basketball is necessary. The NCAA argued that its system was necessary to maintain the popularity of college sports, to ensure competitive balance, to continue the integration of student-athletes in a collegiate setting, and to ensure greater participation than would otherwise occur. All four of these arguments were crushed by Judge Wilken, eviscerating the NCAA’s credo for existence when it comes to men’s basketball and football.
So what now? The NCAA has announced it will appeal, to the liberal 9th circuit, which will likely offer the Ed O’Bannon plaintiffs another victory, this time at the circuit court level. From there the NCAA is likely to appeal to the Supreme Court, which may or may not actually hear the case. If the Supreme Court decides to hear the case, who knows what might happen? After all, the NCAA was found to have committed anti-trust violations back in 1984 as well. That decision, NCAA vs. Board of Regents of the University of Oklahoma, ended the NCAA’s control of college football on television. The decision significantly scaled back the NCAA’s power and influence, ceding power to the individual schools and conferences. Television rights fees eventually exploded and the NCAA would receive none of this money. (If you’re a lawyer you can receive CLE credit by watching me talk about this case online here.) The NCAA survived, but in a vastly weakened state.
Having seen the basis for its existence destroyed at the district court level, does the NCAA really want to risk setting a potentially disastrous precedent at the circuit court and, potentially, Supreme Court level? Not if it’s smart. Right now the district court decision is troubling, but it’s not debilitating. No, what the NCAA really needs right now is, paradoxically given its stance in response to the Northwestern player’s union, a college sports union representing, at the very least, the interest of football and men’s basketball players.
Let me explain why.
While some may believe Judge Wilken finding an anti-trust violation is a big deal, it really isn’t. If the NFL, the NBA, the NHL, and Major League Baseball — assuming we set aside a Supreme Court precedent that found baseball wasn’t a sport — were all examined by courts, they would be found to be engaging in anti-trust practices as well. After all, each of these leagues limits player compensation to some degree, right? So what keeps those leagues out of legal trouble in anti-trust law? Simple, they negotiate with unions representing the players. If you negotiate with a union then your collectively bargained agreement receives an anti-trust exemption. (Every strike or lockout in pro sports has occurred during these negotiations). So league behavior that would otherwise be a violation of federal law, receives protection.
What the NCAA really needs right now is a college union to negotiate with so it can end this case. Unfortunately for the NCAA, there is no player’s union. In fact, the NCAA is actually fighting the rights of players to form a union at Northwestern. This means that virtually any action undertaken by the NCAA is subject to anti-trust suit. After all, “colluding to limit benefits” is just another way of saying “playing by the same set of rules.” If a union isn’t involved in helping to set the rules on compensation then everything the NCAA does in the men’s basketball and football universes is an anti-trust violation. (It’s important to note that Judge Wilken’s ruling only dealt with the athletes who had a market value, that is men’s basketball and football players. All other college athletes aren’t directly implicated by this case). Of course, negotiating with a union that just represented men’s basketball and football players leaves the NCAA open to a suit from other athletes, but we have no idea how the courts will handle a fascinating legal question — how does Title IX, which requires equal opportunity for women athletes — interact with anti-trust law? Would the courts draw a distinction between market and non-market based scholarships or would they find all college athletes must be treated equally? Anyone who tells you they know the answer to this question is just guessing, it’s unsettled law.
That’s why the most ideal situation of all would be a union representing all athletes in all college sports. (The NCAA could also simply agree to be bound by Judge Wilken’s decision and not appeal. This would probably be the second smartest decision). The biggest problem with a union that big? Most college athletes are already receiving a scholarship value far in excess of what their market value would be. That is, a women’s lacrosse player or a men’s track athlete get more benefits via their scholarships than they would otherwise receive on the open market. Both of these sports lose money. In essence men’s basketball and football players are seeing the monetary value they produce being used to subsidize athletic scholarships in other sports. College athletics is not a pure business. Because if it was, you’d probably eliminate all the sports that cost you money and return limited benefits.
So if the best legal outcome is a union representing all college players, what’s the downside? It’s simple, there isn’t enough money to give added benefits to all scholarship athletes. At least not at most schools. If every scholarship athlete received the $5,000+ additional funding per athlete that was laid out by Judge Wilken, many athletic departments would either have to significantly shrink the number of athletic scholarships they provide or increase tuition on regular students to cover the additional athletic department costs. That’s why I think regardless of what happens in this case it’s setting the framework for a case that will shake the foundations of college athletics even more than this one — how do you reconcile the demands of Title IX with the findings that men’s basketball and football players deserve compensation for the increased value they create schools? If men’s basketball and football players begin to receive benefits over and above their scholarship value then Title IX plaintiffs will file suit. What will a judge say about whether this is permissible? I have no idea. No one does. Resolving this issue may take a decade.
In the meantime, the NCAA doesn’t want to enshrine Judge Wilken’s precedent into the legal firmament. It should settle with athletes. The problem is, it needs an athlete union to settle. Think this is messy? You aint’ seen nothing yet.
Are you a lawyer who likes sports? Get online CLE credit here.
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